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WASHINGTON – The IRS is engaged in a systematic process of delaying and denying tax-exempt applications by conservative groups in an effort to elect Democratic Party candidates favorable to the Obama administration, charged the chairman of the House Committee on Oversight and Government Reform in his opening statement at a subcommittee hearing this morning.
Rep. Darrell, R-Calif., said that the IRS practice of “delaying a conservative organization a determination on a tax-exempt application for years is nothing more than an effective denial of the application.”
Issa further charged that new rules proposed by the IRS, which would curb issue advocacy, amount to a continuation of the pattern.
Among the groups giving testimony was the ACLU, which objected to the proposed IRS rules, asserting that the underlying aim was to silence political discussion.
“The provision in the proposed rule extending the definition of ‘candidate-related political activity,’ or CRPA, to what we term “electioneering communications-plus” is so broad that it may extend to this testimony if we were to post it to our website and leave it up during the 30 days before a primary or 60 days before a general election, “testified George Rottman, legal counsel and political adviser to the ACLU.
“Indeed, the rolling nature of the primary blackout would mean that only a small portion of a presidential election year would escape CRPA status,” he said.
In response to a direct question posed by Issa, Rottman readily admitted the ACLU is not generally perceived as a “right-wing, Neanderthal Republican organization.”
Rottman explained that the problem with the proposed rules is that they would outlaw normally accepted issue advocacy by a social organization by defining it as partisan politics.
Issa argued the proposed new IRS rules constituted an attempt to bring tax-exempt 501(c)3 and 501(c)4 organizations under Federal Election Commission laws. It would mean that normally accepted issue advocacy undertaken by conservative tax-exempt organizations would be seen as an attempt to elect or defeat a political candidate.
“In FEC litigation, there is clear case law distinguishing issue advocacy from partisan political activity,” noted James R. Mason, III, senior counsel of the Home School Legal Defense Association.
He said the real goal of the proposed IRS regulations was not to have FEC rules determine acceptable and unacceptable activity of tax-exempt organizations but to empower the IRS to administer election laws.
“After 2010, applications submitted by conservative organizations, particularly if the organization had ‘tea party’ or ‘patriot’ in their name took years to be processed and rarely received approval,” testified Jenny Beth Martin, president and co-founder of the Tea Party Patriots.
“Just mentioning ‘Obamacare’ or even President Obama’s name may be enough for the IRS to object to a conservative group, but the IRS had no problem approving tax-exempt status for a group named after the president,” she said in a reference to the Barack H. Obama Foundation, founded by the president’s brother Malik in Kenya, which was given controversial retroactive approval by the IRS to operate as a 501(c)3 organization.
Martin announced that yesterday, after a wait of three years, the IRS finally approved tax-exempt status for the Tea Party Patriots, claiming the timing of the approval suggested “the IRS wanted me to be able to say we had been approved when I testified here today.”
She explained to the subcommittee that the time and money the Tea Party Patriots have spent trying to get IRS approval was “enormous,” adding that she was convinced the IRS harassed the group because it had the potential to be effective in advancing a conservative agenda.
“We have produced voter guides, hosted candidate debates, encouraged voter registration, supported get-out-the vote efforts and assisted local groups in lobbying on specific local and national legislation,” she testified. “We have invited members of Congress to speak at our rallies and events, not as candidates, but as experts on important topics. We have posted news about national events on our social media sites. The current rules recognize all of these activities as non-political. The proposed rules would classify all of them as political.”
On Jan. 12, WND reported the concerns of Washington-based attorney Cleta Mitchell, a partner in the Washington-based law firm Foley & Lardner, that the new rules proposed by the IRS demonstrates the Obama administration is determined to keep tea party groups from having the type of impact in the mid-term elections this November that they had in November 2010, when Republicans grabbed majority control of the House of Representatives.
A hearing held Wednesday afternoon by the Subcommittee on Economic Growth, Job Creation, and Regulatory Affairs on the question “The Administration’s Proposed Restrictions on Political Speech: Doubling Down on IRS targeting” followed a subcommittee meeting in which legal experts suggested IRS officials may have committed criminal violations by targeting conservative groups and called for a special prosecutor to be appointed..
Rep. Jim Jordan, R-Ohio, the subcommittee chairman, argued the smoking gun in the IRS discrimination scandal traced back to Obama’s 2010 State of the Union speech in which he scolded the Supreme Court for its 5-4 decision in the Citizens United case. The court ruled corporations and unions could spend freely from corporate funds to run political ads against candidates running for elective office.